Josh Perry: Using the GPL as a Dual-Licensing Monopolistic Haven

[Alexander Terekhov]

http://blogs.6bit.com/josh/2010/01/using-the-gpl-as-a-dual-licensing-monopolistic-haven/

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Using the GPL as a Dual-Licensing Monopolistic Haven
By Josh Perry | Published: January 11, 2010

Can a company control the use of their software intellectual property
more completely if they release it under the open-source GNU General
Public License (GPL)? I hadn’t really thought about it before, but while
researching the OSS position of MySql I read an interesting post on
Michael Meeks’ log
<http://www.gnome.org/~michael/blog/copyright-assignment.html> that
alludes to something of this nature.

Philosophically, software is usually released under the GPL for the
purpose of freedom, freedom for a user to do what they will with the
software as long as they afford the same freedom to those who come after
them. This precludes others from hijacking free software and embedding
it in a derivative, proprietary, work. Not all FOSS licenses have these
restrictions, but the GPL does for the purpose of meeting the goals of
the Free Software Foundation.

A number of companies with open-source software released under the GPL
have recently started taking advantage of a dual-licensing model to
generate revenue. This revenue can be put to a number of uses including,
paying developers to work full time on the project, building stock
holder value, and generate cash for acquisitions and other investments.
Richard Stallman himself even reasons that “selling exceptions”
<http://www.fsf.org/blogs/rms/selling-exceptions> is not any more evil
than releasing software under a noncopyleft license such as X11 or BSD.

However, one discipline is required of any organization that wants to
use a dual-licensing model; they must require that the copyright of all
code contributions be assigned to them. Without this assignment they
would have no effective legal right to distribute the software under a
proprietary license.

Mark Meeks talks a lot about the pros and cons of copyright assignment,
and some of it’s fallacies and downfalls, in the article I linked
previously. One downfall that he mentions is that no project that uses
this model has a very vibrant community of contributing developers; most
of the development is done internally by the organisation’s own
developers anyway. If this is the case, then what value does releasing
the software under the GPL really give an organisation?

Lets play the roll of a company has a piece of software IP that they
want to bring to the market. We are a developer hostile company which is
not interested in building a third-party ecosystem around our product.
If there is a possibility to generate revenue related to our software,
we want it. We’ll go through a couple of scenarios with this software to
see how we can accomplish our goals most effectively by twisting the
GPL.

We’ve released our software into the market as a closed-source
proprietary product and it enjoys some success. As it becomes successful
the userbase grows enough that another company, Toolco, sees a market to
provide some complimentary feature to our customers. This company uses
APIs (public or private) and other integration methods to create
closed-source, proprietary plugins or tools that extend the
functionality of our product. DMCA Section 1201(f) protects their right
to this program-to-program interoperability even to the extent of
reverse engineering. Beyond a constant cat and mouse game our company
really has no way to limit the distribution of these extensions or to
take a piece of the pie, as it were.

Our board of directors sits down for a strategy session and after a
couple hours someone recommends something radical. “Lets release our
code under the GPL, require copyright assignment for any contributions,
and use a dual-licensing model to continue generating revenue. In fact,
I expect that most of our development will be done by internal
developers still, though users may be able to provide more in-depth help
fixing odd bugs.” This may not be so insane after all; there are a
number of things that our company gains from this, including some
built-in perceived good will and publicity by releasing our large
product as an open-source project.

Hey wait, you remember the Toolco guys right? They’ve used some
undocumented function calls in one of our libraries to create a backup
tool for our product, it works better and has twice the penetration of
our own module for which we charge an additional fee. Well, Toolco now
has technically created a derivative work of our GPL product by linking
to one of it’s libraries. We now have a number of legal recourses to
force Toolco out of the market and to also prevent any other companies
from creating a product that interoperates with our software.

This may sound tantamount to conspiracy theory but this is exactly what
MySql has done, intentionally or not they have slowly been tightening
the leash on their open-source software. Internal developers do almost
all of the development and any outside contributions must have their
copyright assigned to MySql. Around version 4.1 their client libraries
were changed from LGPL to GPL only; to distribute software that even has
the ability to communicate with an MySql instance you must now either
release your source code or pay for a proprietary license. The copyright
assignment has allowed them to do this without so much as a query to the
MySql community.

Aside from the dual-licensing revenue, they have also begun making a
profit from proprietary management and monitoring software. These
applications use interfaces to MySql that would make any third-party’s
similarly functional package a derivative work and only releasable under
the GPL. This has effectively created a legal haven for Oracle as the
only company in the world that can make a profit by writing closed
software that interoperates with MySql.

The GPL, with a goal to provide software that is free-as-in-speech, has
been effectively used as a legal muzzle to strip freedom and competition
to an extent that even closed-source proprietary software would have
difficulty accomplishing.

This entry was posted in Editorial, Open Source, Technology and tagged
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regards,
alexander.

--
http://gng.z505.com/index.htm 
(GNG is a derecursive recursive derecursion which pwns GNU since it can 
be infinitely looped as GNGNGNGNG...NGNGNG... and can be said backwards 
too, whereas GNU cannot.)